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The SEC Created its Own Scammy ICO to Teach Investors a Lesson

posted by Fnord666 on Sunday May 20 2018, @10:36AM   Printer-friendly
from the still-sets-record-ICO dept.

MrPlow writes:

Submitted via IRC for SoyCow3941

In its latest effort to fend off cryptocurrency scams, the Securities and Exchange Commission launched its own fake initial coin offering website today called the Howey Coin to warn people against fraudulent cryptocurrencies. The name is a tongue-in-cheek reference to the Howey Test that the SEC uses to determine whether an investment is a security, which the Commission would therefore have legal jurisdiction over.

Click 'Buy Coins Now' on the Howey Coins site and you'll be redirected to an SEC page that states: "We created the bogus HoweyCoins.com site as an educational tool to alert investors to possible fraud involving digital assets like crypto-currencies and coin offerings." The SEC uses the page to highlight red flags that customers should watch out for, including a promise of high returns (which indicates high risks), celebrity endorsements, and even false claimes that an ICO is SEC-compliant.

Source: https://www.theverge.com/tldr/2018/5/16/17361750/sec-cryptocurrency-ico-investors

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  • (Score: 3, Interesting) by requerdanos on Sunday May 20 2018, @01:48PM

    by requerdanos (5997) Subscriber Badge on Sunday May 20 2018, @01:48PM (#681856) Journal

    and even false claimes that an ICO is SEC-compliant.

    No, the claims are that the "howeycoins" are traded on an SEC-compliant exchange. Not that the ICO itself is SEC-compliant. From the SEC's scam-awareness page reached by clicking on "Buy Coins" [investor.gov]:

    RED FLAG: CLAIMS OF “SEC-COMPLIANT”

    HoweyCoins will trade on an SEC-compliant exchange where you can buy and sell them for profit.

    The SEC staff has concerns that many online trading platforms appear to investors as SEC-registered and regulated marketplaces when they are not.

    Really, TheVerge, if you're going to be all smart and superior and school the masses about it, it wouldn't hurt to not make up what you're saying, especially when the source is right at hand.

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